Warrior Trading Blog

Trading Recap: Feelin’ Blue, Finished Red, -$6,960!

What’s up everyone? All right. So here we are second red day in a row. I hate red day recaps. These are the worst, and today it’s a big one. Down $6,900. Why? I don’t know why I was so aggressive. I knew out of the gates there wasn’t a lot on the watch list, and my first trade on CHEK I bought right into a big 25,000 share seller. I jumped in with 7,500 shares, and it instantly dropped to $0.30. So I was out $2,100.

 

First trade, first five minutes. I then go into another trade, I jump in with 10,000 shares, and boom, it drops $0.40 per share, and I’m out $4,000. Just like that, it’s my fourth trade of the week, fourth red trade in a row, and I’m down $6,900 on the day. So it is what it is. This is the life of a trader. You got to be able to get knocked off the horse and bounce back up. I’ve fallen off the horse so many times that I just know how to hit the ground, bounce right back up, and jump right back on it. I’ll do it tomorrow.

It’s just one of those things. I’ve just been here so many times where I’ve been sitting at the end of a red day thinking, “Uh. Why? Again.” But it’ll always happen. As long as I’m trading, there will always be red days. So that’s why I’m not crying. I’m not that beaten up about it. It’s annoying. I certainly rather be green today. It’s a little frustrating. But you just got to take it with stride. It’s just the way it is. I’m sure it’s like this with a lot of professions. You can think of a million other professions where you start let’s say building a house and then you realize you screwed something up and you got to take a bunch of stuff down and redo it. It’s frustrating. It’s annoying. But you got to do it the right way and so if that’s what happens, that’s what happens. It’s just the way it goes.

So it’s that way with … You guys, I watch The Deadliest Catch. What’s today? It’s Tuesday. My favorite day of the week, and I’ve seen them where they’ll set a whole string of pots, and they forget to tie one of the parts of the trap and so the crab go in, and they walk back out. They come back through and they have to pick up that whole string of pots, and they’re like, “Every single one is empty. What’s going on?” How much did that cost them in fuel, in time, in lost opportunity? Tens of thousands of dollars. I’m sure it’ll happen another time down the road because that’s life.

So anyways, you just got to take things with stride.

Today’s a red day, but hey, I’m still up $70,000 on the month. $100,000 is still within reach. So anyways, we’ll break down all of today’s trades in today’s Midday Market Recap.

All right. So part two of red day recap. Second red day in a row. I can’t stand having red days like this, and I have this big goal for the month of May. But it is what it is. So today I felt a little more frustrated than I’ve felt in any day recently. Mostly just because I felt like I knew there weren’t a lot of good setups pre-market. My very first trade on CHEK, this one, it was a gap and go stock, and I jumped in it shortly after the bell rang for the break of $5.20.

Basically I bought into a 25,000 share seller, which I didn’t really see until I was getting into it. So I took 7,500 shares at $5.20, and it pretty much … When that seller didn’t break, it just dropped all the way back here down to $4.80. So it dropped like $0.40, and I had 7,500 shares. So on that very first trade I lost $2,300 in the first two minutes of the day, which is awful. I never like to start the day with a lose that big, but it is what it is.

So got stopped out on that one, and then I was sitting tight. We saw CVTI kind of squeezing up, but these are sort of the cheap ones. I don’t usually like to go for them. What was it? Losing my train of thought. SNES, this one continued, but I didn’t think it was really that … I just didn’t think it would be clean. I didn’t really trust it. Again, this kind of price range I’m not as good at. Sort of consolidating here under this high of $1.58. The bell rings, and it does end up squeezing up from $1.58, as you can see here, to $1.64, pull back, and then it taps $1.74. A little pull back, and up to $1.83. So I could’ve traded it, but the level two seemed pretty thickly traded. It was pretty crowded. It already has 27 million shares of volume today. So I didn’t trade it.

Then CARV C-A-R-V pops up on the scanner. I made some money on this one last week, and it pops up and I see it at $7.20, up to a high of $7.34. So I bought the one minute micro pull back right here. But I made a mistake on this order. Instead of, and I don’t know really what happened. Instead of getting in it at 25 and 30, which is where I wanted to get in, I put my limit order all the way up at $7.84. I don’t know why I had such a high limit order. So as I was pressing the buy button, I was getting filled, but I was getting filled way up here. So then I got stopped out as it came back down, and I lost $4,000 on that.

So just like that, I’m down $6,900 on the day for I guess the worst day in two weeks, which is disappointing. Losing nearly $7,000 in one day isn’t fun. Fortunately, I’m still up $70,000 on the month. So I have no right to complain, but this just wasn’t clean.

So on CARV, you can see here, I got in at … I started getting filled at 26 and 33, which is exactly what I expected. My next orders were filling at 46, 50, 61. High of day was 63. So I filled very close to the highs, which was not good. Then two minutes later, it’s back at $7.00. At that point I have no choice but to stop out. So I sold at $7.00 and $6.90 as it dropped down. So just like that, with 10,000 shares, I lost $0.46 per share or something like that. It just creates a little bit of a hole for me to dig out of, not a big hole but a little bit of a hole.

So I made $25,000 last week. I’m up $70,000 on the month as of today. But I still have that goal of $100,000. So that means I got one, two, three, four, five, six days left to make $30,000. It can happen if we see good momentum, but today we didn’t see good momentum.

So after CARV, I was like, “All right. I’m done trading. I’m not going to do this again.” LMFA, I see this one as another one breaking through the $1.00 spot. This is kind of what’s hot right now. Stocks going from $0.75 to $1.00, $1.50. Like I said, generally I don’t do well in this price range. I don’t like trading them. CDTI, it broke through $1.00, hit $1.52, and then came back down and was selling off. We saw BOSC, this was hit the scanners, and look at this. It popped up to $1.53, and then dropped all the way to $2.16. That is an ugly false break out. So it popped up and immediately reversed. RTTR, it popped up and immediately reversed and went to low of day. I mean, it didn’t just pull back a little bit. It ended up going all the way down to low of day.

So this is the kind of market we’re in right now. We’re seeing a lot of choppy action, not good follow through, and this is the time to ease up. I knew that going into the market today, and I just … You underestimate how quickly you can lose $0.30, $0.40 a share. Because yesterday I was able to keep really tight stops, only lost $450. Today, 7,500 shares, boom, I’m out $2,000. Just like that. I mean, it happens so fast. Next thing I know, I’m in CARV. I’m in with a bad entry at $7.42 average, and boom, it’s down to $7.00 and I’m down $4,000. I’ve got no choice but to sell it. Of course, it’s good that I sold it because if I was still holding it, I’d be down a lot more. So I kept my loss relatively small. This is relative to my account size, but definitely a little bit of a disappointing day here.

So I’m hoping that things start to turn around that maybe Wednesday or Thursday, Friday we start to see some really good momentum. I just hope that we can get away from these $0.50, $1.00 stocks because, for me, the only way I can really do well on these is to take pretty big size, and my commissions are expensive. If I take a 30,000 share position, I’m spending like $100 buying and selling. I mean, my commissions are going to be like $200 round trip just because of the way Direct Access Routing charges you per share routing. So these types of stocks are great if you’re at E-Trade or Ameritrade, it’s a flat rate. But when you’re trading with any direct access broker, these get expensive. So I don’t really like to trade them for that reason. It just immediately puts me in the hole.

We also have the T12 risk, which we’ve seen in the past stocks that went from being below $1.00, anything below $1.00, to squeezing through and being above $1.00 had risk of getting halted on T12, and that’s when they’re halted pending investigation. The question is the exchange says, “What’s caused your company to go up 67% today? Is there news?” A lot of these, there no news. LMFA, we can check to see if there’s any headline on Market Watch. So when you have these types of moves without a headline, especially when they were kind of in the penny stock range, it can get I think regulators a little bit interested in what’s going on. That doesn’t seem to be as much of an issue with the higher priced stocks. I mean, it can be when a stock goes from $10.00 to $150. But for some reason the penny stocks really seem to catch that attention.

So that always makes me nervous when I’m looking at stocks that are right round this price. Just that potential risk of a T12 halt. So we haven’t seen any in a couple weeks. So maybe it’s not really a risk today, but that plus the share size plus the fact that on a lot of these break outs, at best, you’re getting 10 or 15 cents. The only way you make money on 10 or 15 cents, take really big size. It’s just not my cup of tea. So I really like trading stocks between $2.00 and well, $2.00 and $10.00. $2.00 and $8.00 is good, and these ones just really aren’t my thing.

So I got to sit tight and be patient. It’s not fun when you just got to sit on your hands and it’s not fun when you get into trades and then you immediately lose $4,000 or $5,000, but that comes with the territory of trading with big size, and you guys know that. So if you step up to the plate and try to trade with 10,000/15,000 shares on a regular basis, you’re going to have days where you make $28,000, $29,000. But you’re also going to have days where you lose money. This is these days right here even though they don’t look that big relative to my green days, this is an $11,000 losing day. This is a $13,000 losing day, right? So that’s what comes with the territory of trading with big size. You’re going to have big green days but you’re going to have big red days. You just hope that the red days are far enough apart that you’re not digging yourself into a deep hole when you do start to get the draw down.

So I don’t know if I have my max draw down on here. I’m not seeing it. I don’t remember where it is. But there’s a chart on here where you can see your draw down. So it’s the most … Oh, there it is. So you can see here in the last couple months, I’ve peaked on a max draw down of about $20,000, $22,000. So that means from my all time highs, I’ve dropped down $20,000. But this is what my equity curve looks like, and that’s just over … Well, what is this period? That’s going all the way back to 2016. So that’s a nice equity curve. I mean, I’m up here at $926,000 just in the last two and a half years. So yeah. But like I said, these draw downs aren’t fun. The flat periods, the periods of sideways action where you just got to bite your tongue and sit on your hands. It’s not easy, but it is what it is.

So a little bit of a pull back here today. $6,000, $7,000. Hopefully tomorrow will be able to start to turn it around and have a green day. But yeah, you can see since 2016, my drawn downs have definitely gotten bigger, but the equity curve is also started to go up a lot faster. So that’s relative to taking more risk. You take more risk and you’re going to have bigger red days, but then when you have green days, that’s where it pays off.

These are my metrics right now. Guess this is whatever. $900,000. 75% accuracy. One to one profit loss ratio. That’s the biggest thing for me is trying to keep that profit/loss ratio positive is hard when you take an approach of scalping. Getting in, getting out, taking quick profits and that type of thing. So it’s the nature of my strategy a little bit. But the other side of scalping is that when you’re up $0.15 or $0.20 and you take profit, it’s not hard to predict when a stock will go up $0.15, $0.20. So it makes your accuracy pretty high. So that’s why it’s up here at 70%. This is over the course of 2,000 trades. So there’s a lot of validity to these numbers.

Anyways, that’s about it for me. Big picture, life it good. Not going to complain. Still in really great shape on the month, and we still have eight/nine days, six/seven days left in the month. So we’ve got time to recover, and get myself back to 75, 85, maybe $100,000. That’s the goal.

All right. That’s it for me. I’ll be back at it first thing tomorrow morning. I’ll see you guys bright and early, 9:00, 9:15 for Pre-market Analysis. All right. I’ll see you guys then.

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